Amazon Prime, the online retailer’s loyalty membership programme, is now available in over 100 Indian cities with unlimited free one- and two-day delivery.
With the launch of Prime, Amazon will take on Flipkart First, a paid annual subscription service for registered Flipkart users.
Prime — which has been witnessing over 50-per cent year-on-year growth in memberships — was first launched in the US in 2005, followed by nine other countries in 2013. India is the 11{+t}{+h} country where Prime has been launched.
Like Flipkart First, which offers its members early access to products, exclusive offers, benefits and shopping events, Prime members can enjoy ‘Prime Early Access’, allowing purchase of top deals 30 minutes early, every day; along with exclusive deals from brands and sellers.
Competition Prime is being offered at an introductory annual subscription fee of ₹499, at a discount of ₹500 over the list price of ₹999, which is ₹1 lower than Flipkart First’s ₹500.
Customers who sign up early can experience Prime free for 60 days, which is twice the normal trial period globally. Non-members will continue to have the option of expedited delivery on their orders with the usual delivery charges, where applicable.
Prime members in 20 cities can choose same-day, morning or scheduled delivery at a discounted fee of ₹50 per order (otherwise priced at ₹150) on over 10,000 products; which is ₹20 cheaper than Flipkart First, which offers same-day guaranteed delivery at a discounted price of ₹70 per item.
“Customers in India would be irresponsible not to sign up for Prime, where guaranteed one-day delivery becomes an everyday experience instead of an occasional indulgence and with no minimum purchases. Customers have always enjoyed in-stock selection and convenience; with Prime they can now shop more often,” Amit Agarwal, Vice-President and Country Head, Amazon India told BusinessLine . Customers can sign up for Prime at www.amazon.in/prime.
Answering a question on how he expects Prime to be received in India, Greg Greeley, Vice-President, Worldwide Prime, Amazon, on a call from the US, told BusinessLine : “I have no doubt that Prime will do exceptionally well in India. A Prime Day Sale that we hosted on July 12, saw the participation of 2,200 Indian sellers through our Global Sellers Programme. These sellers recorded over 100 per cent increase in sales that day.”
Seller platforms While all Prime products will be delivered through Fulfilment by Amazon (FBA), which helps sellers increase online sales by giving them access to Amazon’s fulfilment resources; Flipkart First products are also delivered through Flipkart Advantage, where Flipkart offers stocking and shipping service to the merchants selling their products on Flipkart.
Asked how many of Amazon’s 1,00,000 sellers are on FBA, Agarwal said 75 per cent of the products on Amazon.in are sold through FBA.
According to sources who wished to be anonymous, 70 per cent of Amazon’s orders are being fulfilled by FBA at present, while Flipkart is averaging 35-50 per cent for orders fulfilled by Flipkart First.
“Although Flipkart introduced Flipkart Advantage two years ago, it has not been able to onboard the bulk of its 90,000 sellers onto Advantage because management changes over the last 18 months led to a lot of flip-flopping on business strategy, with no clear direction, until recently,” the sources said.
Mrigank Gutgutia, Engagement Manager, RedSeer Consulting said Amazon’s advanced technology tools to manage seller lifecycle, which allows sellers to monitor sales performance and track orders, have resulted in sellers being able to up their ante and sell much more through FBA.
He said: “Amazon’s single-minded focus on boarding sellers through multiple programmes such as Tatkal and Chai Cart has brought the bulk of its sellers on FBA. Flipkart will have to play catch up.”